Like with other types of loans, your credit score will influence your ability to get a car loan.
While there's no specific credit score you'll need to be eligible for a car loan, a higher score will boost your chances of getting approved, and can also give you access to better offers and interest rates.
It's also possible to get a car loan with bad credit, but you may find your loan options are much more limited.
There is no specific credit score that you'll need to be eligible for a car loan, but having a "good" credit score or better will improve your chances of getting approved. However, as most car loans are secured loans, a bad credit score won't necessarily rule you out of being approved for car finance.
Having a good credit score can also make you eligible for lower interest rates and better loan terms, so you should make sure you've done everything you can to improve your credit score.
Your credit rating will directly affect your ability to access most loans and car loans are no different. It is normal for banks and lenders to check your credit file during the application process before they approve you for a car loan.
If you have a bad credit file or any negative marks on your file, this will classify you as a risky borrower and could significantly limit your options in terms of getting a car loan.
Lenders like to know they are lending money to someone who has the capacity to repay back their loan, so if there are any marks on your file that indicate you may not be able to do so, this will limit your access to a car loan.
Yes, when you apply for a car loan the lender will apply a "hard" credit check, which will appear on your credit report and can impact your credit score. Having too many hard credit checks on your credit file can significantly damage your score, so it's important you don't apply for too many loans in a short space of time.
| Response | |
|---|---|
| Very likely | 37.01% |
| Somewhat likely | 33.96% |
| Neutral | 20.37% |
| Very unlikely | 6.59% |
| Somewhat less likely | 2.07% |
If you do have bad credit, there are still some car loan options available that can help you buy a car:
If you do have a bad credit rating, there are some ways you can improve the chances of being approved for a car loan.
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Hi when applying for a car loan what is considered to be a good credit score please
Hello Ejm,
Thank you for reaching out to us.
You may refer to our guide on what is a good credit score?. To buy a car, a good credit score is normally above 620. However, there is no “official” industry-wide minimum credit score in order to qualify for a loan. You will not automatically be ruled out for a loan if you have a low credit score but you may face higher interest rates.
Learn more about car finance and credit scores to know how does your credit affect your ability to access car loans.
I hope this helps.
Let us know if there is anything that we may assist you with.
Cheers,
Ash